A radicle solution to the housing crisis in London
According to an article “Grenfell: names of wealthy empty-home owners in borough revealed” on The Guardian website there are 1,652 properties listed as unoccupied in Kensington and Chelsea. That is 1,652 properties that could be used, not as an investment, but as homes.
(This map shows London’s 20,000 empty homes: Time Out: May 10 2017)
It is estimated there are twenty thousand “ghost” homes across London. That is twenty thousand properties that could be a home to someone. That is an outrage.
There are many reasons for this. Not least because interest rates have been kept at ridiculously low levels since the 2008 crash. Those who have money have been buying property because it gives them a better return on their investment. (This nugget of information was given to me by the estate agent who sold the flat we rented; our landlord wanted to sell, so we had to find somewhere else to live.) Throw into this mix foreign nationals, encouraged to buy property as an investment by UK based estate agents, and you have a deepening crisis. Most people with average incomes, even above average incomes, are priced out of the market.
There are a couple of thing that could be done to stop this kind of hoarding. Interest rates could be increased so those with assets get a decent return on their money. This might force the price of property down so hoarding gives less of a return on an investment. If interest rates were put up, mortgage repayments would increase. Some of those who have benefited from low interest rates would not be able to afford their mortgage; a glut of property would be repossessed and released into the market, bringing prices down. This brings with it a whole level of misery I would not wish on anyone. I also don’t think it would have the desired outcome. I suspect the repossessed properties would be swallowed up by those with pockets deep enough to speculate.
The other strategy is more radicle and has the potential to solve the problem. The fist half of the strategy involves extending the rights of private tenants. We need to pass laws that give renters a right to long term leases. Not six or twelve months but five or ten years. People need that kind of stability in their lives. These long term leases also need to come with rent controls. The second half of the strategy is to force the owners of all property that sits empty to become landlords. Your property sits empty for more than six months; you have to rent it out, on a long term lease, at rent controlled prices. Investors will either sell their property because they don’t want to be landlords or the properties will be used as they were intended; as homes for people to live in.
I can just feel the vitriol coming my way from he vested interests. But the neoliberal market is broken and we need radicle solution. This is about as radical a way to home people as I can think of. Yes build more affordable homes but also put the stocks we have to better use.